Digital Culture 4.0: Going Deeper Within The Flat Structured Org

A big thank you to all this week who DMd me their thoughts on "Because Flat Structures Don't Work".

It was interesting to hear the supporting views along with various solution based inputs, based around the new age of data. This new dynamic brings intelligence to the small-business teams, enabling a more empowered approach across the flatter organisation.

Today, as a small business leader myself, allowing others to be better Intrepreneurs or Entrepreneurs, makes a whole lot of sense to me and brings me to continue the new world of small businesses making up the Flat Structure.

The bottom-line is, we all want to be closer to our customers, to understand them better and what they want. Bring that to the organisation and it translates to responsiveness from the outside to within. For the first time in over a century, we are seeing a shift in how organisations start to think and operate structurally.

Building or recreating an organisation that lives across the entire value chain, promotes innovation and learning, all motivated by a shared collaboration is the ultimate goal. Getting there today is an organisation built on micro and small business leaders within, armed with the data intelligence to run and manage "their" businesses.

We call it Flat Structure Operations: “a comprehensive practice for structuring, governing and running an organization. It replaces today's top-down, predict-and-control paradigm with a new way of achieving control by distributing power.”

What's So Wrong About The Hierarchy?

For many generations of business, communication, the lifeblood of business, starts at the top or bottom and flows up and down, with just the top holding all the cards with all the intelligence sitting at the top of the pyramid.

Businesses have been built on age-old real estate construction type principles, whereby a building has to be built to last and really not change for decades and where I live (the UK), centuries. A large building can require meticulous planning and design over months, before any construction can start.

Change in the hierarchical organisation is only as fast as the leadership can handle it.

However, over recent decades, with the proliferation of software throughout, we've become more accustomed to more flexible, changeable and adaptable planning processes. People change, as do their wants, because technology infiltrates all that we do and we evolve. Nothing stays the same, people are unpredictable and so operational approaches must adapt too.

Flat operations across the business, is and will be one of the operating models to adapt to human consumer unpredictability.

The Small Business Cogs

Customer-centric organisations want to distribute authority and decision making to all within. The goal is to increase their capacity to learn and respond to change brought about through customer demand, by empowering more of them to do so.

Flat Structures need clearly defined rules, accountabilities and communication lines, contrary to what you might think. It's not all about free-roaming artsy people, doing what they want, when they want.

Imagine The Flat Structure as a series of Small businesses that start-up with a customer and an initial product. You're in a small team and have some rules, accountabilities and objectives. Things start to move fast; a new customer? A new order? An economic shift? Suddenly you need to adjust and with the speed of a start-up, you can change the rules, accountabilities and objectives and you communicate them clearly - that's holacracy for fluid policies. Given unpredictable customers, no change will ever be perfect.

I'm starting to think of the Flat Structure as multiple small businesses, filled with sub-contractors and fueled with vertical and horizontal value chain structured and contextual data. Each small business can be broken up and put back together with new sub-contractors at anytime. The small business has its clearly defined responsibilities and can if necessary, establish micro-businesses within.

The hierarchical organisation taught us people have egos that go with titles and like it or not, pandering to some degree to this human trait needs consideration. Creating titles, with fluid accountabilities, removes many of the ego and emotional issues. In the Flat Structure, the number of people reports becomes irrelevant and its more about the number of logically grouped roles that defines you.

Each small business, has a leader, but more a team leader/mentor than actual boss. They assign people to other roles in the small business, but aren't there to tell people how to necessarily do their job, unless help is sought.

"When a boss tells their team they get to decide, everyone still knows it's really the boss' neck on the line."

That is not the Flat Structure!

When issues arise, it's more about Flat Structures spending more time arguing about who should be able to decide and why that wasn't clear to begin with, rather than debating the issue and how it should be dealt with, when already there exists the small business team to go away, try, fail and learn new ways.

Flat Structure Problem Solving

When an organisation is confronted with a problem; be that new product demand, losing market share, attrition etc, common-sense dictates bringing together a range of skills to look at the issues and solve it. This is best known today as a Cross-Functional Focus Group (CFG). But, that being said, how often does it happen?

Typically, senior management confronted by rigid hierarchical structures, full of egos find it easier and faster to "take it" (the problem) and start work on the solution, eventually cascading it ("what we're going to do") throughout the organisation, leaving all but the "superstars" unempowered.

The challenge remains with a hierarchical mindset, to design a permanent structure where the right people can work together with as few dependencies as possible, in order to keep decision making "tight". So far, no one has found a way!

As a result, if that's the case, how do you make sure the right people are in the right place and "small businesses" when new problems arise every day? Especially when changing hierarchical structures require painful and expensive re-organisation.

The Flat Structure changes the rigid and old-school mindset to one of fluidity and solution orientated for the benefit of the customer and therefore business.

Love The Idea, But What About The Execution?

The thought of a new small business mindset that's filled with cross-functional sub-contractor expert types that can be moved in and out to focus on customer challenges sounds amazing.

 What's critical is arming them with the data intelligence to respond and manage.

That's where Industry 4.0 technologies enters the frame that combined with the Digital Culture 4.0, allows the enterprise to transform in the 4th Industrial Revolution.

If you've experienced the Flat Structure, let me know. Let me know what you learnt from the mistakes that were made

Always love to hear from you

Andrew

asparrow@haigand.co

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